-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, D4wEHu6weo/4n5GdcJWy5a9iui3O55iWUshJzpRV02/XASoA3bdpcZSEduXuJe// N/K9pwEmryfu1avPneAvGA== 0000051103-98-000001.txt : 19980217 0000051103-98-000001.hdr.sgml : 19980217 ACCESSION NUMBER: 0000051103-98-000001 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19971231 FILED AS OF DATE: 19980212 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNATIONAL ALUMINUM CORP CENTRAL INDEX KEY: 0000051103 STANDARD INDUSTRIAL CLASSIFICATION: METAL DOORS, SASH, FRAMES, MOLDING & TRIM [3442] IRS NUMBER: 952385235 STATE OF INCORPORATION: CA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-07256 FILM NUMBER: 98534901 BUSINESS ADDRESS: STREET 1: 767 MONTEREY PASS RD CITY: MONTEREY PARK STATE: CA ZIP: 91754 BUSINESS PHONE: 2132641670 MAIL ADDRESS: STREET 1: 767 MONTEREY PASS ROAD CITY: MONTERY PARK STATE: CA ZIP: 91754 10-Q 1 FORM 10-Q FOR QUARTER ENDED DECEMBER 31, 1997 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OF THE SECURITIES EXCHANGE ACT OF 1934 For quarter ended December 31, 1997 Commission File Number 1-7256 INTERNATIONAL ALUMINUM CORPORATION (Exact name of Registrant as specified in its charter) California 95-2385235 (State of incorporation) (I.R.S. Employer No.) 767 Monterey Pass Road Monterey Park, California 91754 (213) 264-1670 (Principal executive office) Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filing requirements for the past 90 days. Yes X No At February 2, 1998 there were 4,290,494 shares of Common Stock outstanding. Page 1 of 11 Pages INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES INDEX Page Nos. PART I Financial Information Consolidated Balance Sheets - December 31, 1997 and June 30, 1997 3 Consolidated Statements of Income - three and six month periods ended December 31, 1997 and 1996 5 Consolidated Statements of Cash Flows - six months ended December 31, 1997 and 1996 6 Notes to Consolidated Financial Statements 7 Management's Discussion and Analysis of Financial Condition and Results of Operations 8 PART II Other Information Item 4. Submission of Matters to a Vote of Security Holders 10 Signatures 11 - 2 - PART I INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
Unaudited Audited Assets Dec. 31, 1997 June 30, 1997 Current assets: Cash and cash equivalents $ 10,620,000 $ 6,485,000 Accounts receivable, net 34,078,000 35,773,000 Unbilled receivables 885,000 Inventories: Raw materials 28,329,000 32,275,000 Work-in-process 1,908,000 2,320,000 Finished goods 6,592,000 7,398,000 Prepaid expenses 2,734,000 1,834,000 Future income tax benefits 1,289,000 1,289,000 Total current assets 85,550,000 88,259,000 ____________ ____________ Property, plant and equipment, at cost 94,699,000 99,564,000 Accumulated depreciation (49,756,000) (53,600,000) 44,943,000 45,964,000 ____________ ____________ Other assets: Costs in excess of net assets of purchased businesses 10,021,000 10,290,000 Other 523,000 528,000 10,544,000 10,818,000 ____________ ____________ $141,037,000 $145,041,000 ____________ ____________ ____________ ____________ See accompanying notes to consolidated financial statements.
- 3 - INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
Unaudited Audited Liabilities and Shareholders' Equity Dec. 31, 1997 June 30, 1997 Current liabilities: Accounts payable $ 5,677,000 $ 9,417,000 Accrued liabilities 10,114,000 11,727,000 Income taxes payable 452,000 976,000 Total current liabilities 16,243,000 22,120,000 ____________ ____________ Other liabilities: Deferred income taxes 4,362,000 4,362,000 Other 319,000 4,362,000 4,681,000 ____________ ____________ Shareholders' equity 120,432,000 118,240,000 ____________ ____________ $141,037,000 $145,041,000 ____________ ____________ ____________ ____________ See accompanying notes to consolidated financial statements.
- 4 - Unaudited INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
Three Months Ended Six Months Ended December 31, December 31, 1997 1996 1997 1996 Net sales $55,659,000 $56,161,000 $115,168,000 $113,089,000 Costs and expenses: Cost of sales 38,214,000 40,350,000 79,935,000 81,188,000 Selling, general and administrative expenses 11,686,000 13,455,000 24,763,000 27,256,000 Interest (income) expense, net (68,000) 13,000 (81,000) (84,000) Income before income taxes 5,827,000 2,343,000 10,551,000 4,729,000 Provision for income taxes 1,970,000 1,070,000 3,990,000 2,120,000 Net income $ 3,857,000 $ 1,273,000 $ 6,561,000 $ 2,609,000 ___________ ___________ ____________ ____________ ___________ ___________ ____________ ____________ Shares used to compute EPS: Basic 4,282,994 4,262,348 4,276,319 4,261,419 Diluted 4,294,837 4,274,683 4,286,778 4,274,083 Earnings per share: Basic $.90 $.30 $1.53 $.61 Diluted $.90 $.30 $1.53 $.61 Cash dividends per share $.30 $.25 $.55 $.50 See accompanying notes to consolidated financial statements.
- 5 - Unaudited INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
Six Months Ended December 31, 1997 1996 Cash flows from operating activities: Net income $ 6,561,000 $ 2,609,000 Adjustments for noncash transactions: Depreciation and amortization 2,881,000 2,197,000 Gain on disposition of business (1,156,000) Writedown of long-lived assets 888,000 Changes in assets and liabilities: Receivables (544,000) 2,806,000 Inventories 4,277,000 266,000 Prepaid expenses and other (1,066,000) 364,000 Accounts payable (806,000) (914,000) Accrued liabilities and other (989,000) (776,000) Income taxes payable (511,000) (30,000) Net cash provided by operating activities 8,647,000 7,410,000 Cash flows from investing activities: Capital expenditures (3,505,000) (3,366,000) Proceeds from sales of capital assets 48,000 175,000 Disposition (acquisition) of businesses 1,021,000 (6,971,000) Net cash used in investing activities (2,436,000) (10,162,000) Cash flows from financing activities: Repayment of long-term debt (423,000) Exercise of stock options 272,000 35,000 Dividends paid to shareholders (2,355,000) (2,131,000) Net cash used in financing activities (2,083,000) (2,519,000) Effect of exchange rate changes on cash 7,000 Net change in cash and cash equivalents 4,135,000 (5,271,000) Cash and cash equivalents at beginning of period 6,485,000 13,230,000 Cash and cash equivalents at end of period $10,620,000 $ 7,959,000 ___________ ___________ ___________ ___________ See accompanying notes to consolidated financial statements.
- 6 - Unaudited INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Basis of Presentation In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (which consist solely of normal recurring adjustments unless otherwise disclosed) necessary to present fairly its financial position as of December 31, 1997 and June 30, 1997, and the results of operations for the three and six month periods ended December 31, 1997 and 1996, and the cash flows for the six month periods ended December 31, 1997 and 1996. The results of operations for the three and six month periods ended December 31, 1997 and 1996 are not necessarily indicative of the results to be expected for the full year. The financial statements included herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these financial statements be read in conjunction with the financial statements and the notes thereto included in the Company's latest annual report on Form 10-K. This report contains forward-looking statements with respect to the financial condition, results of operations and business of the Company. Such items are subject to certain risks and uncertainties that could cause actual results to differ materially from those set forth in such statements. Disposition Of Foreign Subsidiary During the quarter ended December 31, 1997, the Company sold Eland-Brandt, B.V., it's dutch subsidiary. The sale generated an after-tax book gain of $1,156,000 or $.27 per share and provided $1,021,000 in net cash proceeds. Due to the sale, the Company's consolidated financial statements for the second quarter do not include the operations of Eland-Brandt, B.V.. - 7 - Unaudited INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES Management's Discussion and Analysis of Financial Condition and Results of Operations Significant Changes in Results of Operations: Net sales decreased by $502,000 or 0.9% for the quarter ended December 31, 1997 and increased by $2,079,000 or 1.8% for the six months then ended when compared with the 1996 periods. The sale of the Company's dutch subsidiary, Eland-Brandt B.V., during the second quarter significantly impacts period comparisons. The exclusion of Eland-Brandt from fiscal 1997 shows increases of $3,130,000 or 6.0% for the quarter and $6,373,000 or 4.2% for the six months. The sales from continuing operations include increases posted by the Residential Products Group, up $945,000 or 9.0% for the quarter and $1,939,000 or 8.6% for the six months, the Aluminum Extrusion Group, whose sales were up $1,054,000 or 9.8% for the quarter and $1,256,000 or 5.3% for the six months and by the Commercial Products Group, whose sales were up $452,000 or 1.6% for the quarter and $2,351,000 or 4.4% for the six months. Cost of sales as a percentage of net sales decreased by 3.1% for the quarter ended December 31, 1997 and by 2.4% for the six months then ended when compared with the 1996 periods. These decreases are primarily attributable to increased margins in the Aluminum Extrusion Group and the Residential Products Group resulting from labor and overhead efficiencies attained through higher sales volume. Also a factor were the inventory and asset writedowns related to the purchase of Altura during the second quarter of the prior year. Selling, general and administrative expenses decreased by $1,769,000 or 13.1% for the quarter and by $2,493,000 or 9.1% for the six month period. The expenses related to continuing operations was essentially unchanged as costs eliminated by the sale of the subsidiary were offset by additional costs associated with the increased volume of continuing business. The non- recurring changes are the gain on sale of subsidiary during the second quarter of the current year, a writedown of long-lived assets during the first quarter of the prior year and a charge for asset writedowns and restructuring related to the purchase of Altura during the second quarter of the prior year. The increase in net interest income for the quarter directly relates to the significantly increased level of funds available for investment. The effective tax rate for the six months ended December 31, 1997 was 37.8% whereas the comparable period of the prior year was 44.8%. This decrease is directly related to the sale of the foreign subsidiary which incurred a small taxable gain in relation to the book gain. - 8 - Unaudited Liquidity and Capital Resources: Working capital increased to $69,307,000 during the six month period ended December 31, 1997, which is an increase of $3,168,000 from June 30, 1997. The ratio of current assets to current liabilities is currently 5.3 as compared to 4.0 as of the beginning of the year. The Company's projected net capital expenditures for fiscal 1998 include $7,000,000 for scheduled expansion of production capacity in addition to the normal annual noncapitalized expenditures for replacement items. The Company anticipates financing these expenditures through internal cash flow and cash reserves. The Company's line of credit remains unchanged from that noted in the June 30, 1997 Annual Report to Shareholders. - 9 - PART II. OTHER INFORMATION Item 4(c). Submission of Matters to a Vote of Security Holders On October 30, 1997, the Company held its 1997 Annual Shareholders Meeting. Shareholders voted proxies representing 3,911,177 shares which was 91.6% of the 4,267,619 shares outstanding on the record date. The proposed slate of directors were elected with 3,900,764 shares and the selected independent accountants were ratified with 3,905,381 shares. - 10 - INTERNATIONAL ALUMINUM CORPORATION AND SUBSIDIARIES Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. International Aluminum Corporation (Registrant) Date February 11, 1998 DAVID C. TREINEN David C. Treinen Senior Vice President - Finance and Administration (Principal Financial Officer) Date February 11, 1998 MITCHELL K. FOGELMAN Mitchell K. Fogelman Vice President - Controller (Principal Accounting Officer) - 11 - EX-27 2 FDS FOR SIX MONTHS ENDED DECEMBER 31, 1997
5 1,000 6-MOS JUN-30-1998 DEC-31-1997 10,620 0 34,078 0 36,829 85,550 94,699 49,756 141,037 16,243 0 0 0 8,822 111,610 141,037 115,168 115,168 79,935 104,698 (81) 401 48 10,551 3,990 6,561 0 0 0 6,561 1.53 1.53
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